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Recruitment, Price-Fixing and the Competition for Talent

This post outlines the spirit of the Competition Act and the significance for recruitment firms demanding rival firm pay information. Firms can’t compete unfairly for talent, neither may they treat job applicants unfairly by not being upfront about pay.

The Competition Act outlines a fair and competitive economic environment

Ordinary citizens pursuing a role in the economy are deemed to be on equal footing with the employed who interview them. Job applicants cannot be unfairly treated simply because they are in a vulnerable job seeking position.

In a free economy wages may not be price fixed. Labour has the enshrined right to seek opportunity and pursue better wages.

The opening statement of the Act says:

To provide for the establishment of a Competition Commission responsible for the investigation, control and evaluation of restrictive practices, abuse of dominant position, and mergers; and for the establishment of a Competition Tribunal responsible to adjudicate such matters; and for the establishment of a Competition Appeal Court; and for related matters.

WHAT’S RELEVANT FOR RECRUITMENT?

  • control and evaluation of restrictive practices
    • the omission of pay information in job adverts followed by recruiters forcing candidates to provide personal information for their market research purposes
    • Recruiters force job applicants to surrender information or be expelled from the recruitment process. 
      • the demand for pay slips as a criteria for potential employment. This practice discriminates against those who have been unemployed and cannot provide records
      • pay slips used as a wage determinant is restrictive practice as firms don’t compete fairly for talent
      • Firms place restrictions on wage offers based on information contained in pay slips, this is a breach of the applicants trust as the firm is using information provided by the applicant – against the applicant. This has been cross referenced with a legal case in South Africa, Dun and Bradstreet.
  • abuse of dominant position
    • Firms force recruiters to obtain pay slips from applicants or no trade agreements ensue
    • This information allows firms competing for talent to spy on each other, job applicants are thereby coerced into committing industrial espionage
    • Firms use privileged information to unfairly compete for talent

Let’s start taking action! Leave comments below!

Does income inequality exist because job applicants trust recruiters? #HRMustFall

 

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